Towry and the urgent need for IFA firms to encourage loyalty

When Ashley Cole left Arsenal for Chelsea, it is unlikely a single Gunners fan changed allegiance. It hardly needs saying that this is because football fans are loyal not to the players in their team but to their club. So why is it that when advisers leave IFA firms they are sometimes able to poach the clients they have been working with? As the dust settled after the explosion of over 150 tweets last week about the collapse of Towry’s legal case against seven Raymond James advisers, this was the question that many in the advice industry were left pondering. Some have called for the creation of an industry-agreed standard on restrictive covenants in contracts – or a ‘Broker Protocol’, as it is called in America – to outline rules for advisers to follow when they leave their employer. Sensible though this might be, it focuses entirely on restricting the adviser and speaks nothing of retaining the client simply by ensuring they want to stay. So how can IFA firms make clients loyal to the business, as well as the adviser? The clue is in the words of the judge in the Towry case when she handed down her verdict at the Royal Courts of Justice. Mrs Justice Cox highlighted the “trust” people feel for advisers when they have had “a close, personal and professional relationship” with them. As any adviser will tell you, this trust primarily comes from the adviser consistently providing the relevant and best information to enable the client to make important decisions at their convenience. This relies on a demonstration of knowledge and expertise. Secondly,...

Will the City of London break its social media gagging order?

As is so often the case in social media, we can only predict what will happen in the UK by glancing at our adventurous cousins in the US. There, the financial services sector has just bravely dipped another toe into the choppy and unsure waters of social media in the face of draconian regulation. Until now, many of the big investment firms have imposed a blanket ban on their advisers and brokers using social networks for work, so unsettled are they by the threats of the Financial Industry Regulatory Authority (Finra). A brave few, including Merill Lynch and Wells Fargo, allow their advisers to create social media profiles on LinkedIn and Twitter for private communications, including invitations, introductions and private messages related to work. This means they can talk with social media-savvy clients in a way that suits those consumers – but privately. However, in a rather intriguing development last week, Morgan Stanley told its 18,000 advisers they’d now be allowed to start sending out public messages relating to market updates, economic and investment insights and wealth management topics. That’s right, they’re now allowed to start tweeting about work and what they do. But there are strings attached: the messages all have to have gone through prior compliance approval. Yep, that means they’ll be prepared for general use by no-one in particular for no-one in particular to serve up to no-one in particular, a bit like a loaf of bread in a supermarket. I realise all of this sounds faintly ludicrous in a space that demands authenticity and spontaneity – but hear me out; it’s a positive step. The...

Is Foursquare the right social technology for IFAs?

I have to admit, I’ve always been a fan of the location-based app Foursquare. My fiancée uses it at her tea shop to drive business, generate word-of-mouth marketing and to grab some publicity when she can. In my last role as head of media at Brighton & Hove City Council, I helped organise the public sector’s first Foursquare Day to boost visitor number to libraries. So it was with genuine excitement that I read this morning that Philip Calvert, front man for the social network for independent financial advisers IFA Life, had formed a partnership with the app. For those who don’t know what Foursquare does, it allows users to ‘check in’ using smartphones when they visit any location – swimming pool, office, church (yes, there are churches on Foursquare), launderette or even the park bench. When they do this, their friends and followers on Facebook and Twitter are alerted to this fact – and the idea is that, potentially, they might be interested in the venue themselves. Users win virtual badges (for example the ‘swarm badge’ when they check into a venue where there are at least 49 others checked in) making it part social network, part game. The best-known accolade in the game is being ‘mayor’ of a venue – or the user who has checked in most times over a 30-day period. The application uses a mobile phone’s GPS locator to work out its location and tells the user what Foursquare venues are in the immediate vicinity. Users can see if friends have checked in near them and get suggestions on things to do where they are. The possibilities...

Five social media IFAs

When George Emsden was diagnosed with throat cancer in 2007, his instinct was to keep it to himself. Four years later he is one of Twitter’s best-known Independent Financial Advisers and his online identity “CancerIFA” could barely be more stark. Time for a celebratory cup of tea. The story of how George defied his inhibitions to find catharsis in speaking about his illness is an inspiration in itself – but another absorbing aspect of this tale is untold. You see, George is a case in point about how the Internet has changed the way the world does business. Social networks have allowed people all over the planet with niche – but common – interests to connect as never before. For businesses with a specialism, this is a golden opportunity. Imagine, if you will, a Runcorn-based record shop specialising in 1930s Romanian folk. Ten years ago, with a potential customer-base of probably somewhere around none in that town, there would not have been any business. Now it’s possible to connect to the few thousand dotted around the world’s seven continents who love pre-war Romanian folk – and to build a business by selling regularly to, say, a tenth of them every year. We live in a global economy of niches – marketing wonks call it The Long Tail – and for financial services, this means being able to target specific markets in ways that never previously existed. This is exactly what George is doing. He is one of the few people in the country with the personal experience and the professional expertise to help people take care of their money issues after a life-shattering...